Parker-Hannifin (PH) Tops Q1 EPS by 11c; Provides FY20 EPS Guidance

October 31, 2019 7:43 AM EDT

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Parker-Hannifin (NYSE: PH) reported Q1 EPS of $2.76, $0.11 better than the analyst estimate of $2.65. Revenue for the quarter came in at $3.33 billion versus the consensus estimate of $3.33 billion.

  • First quarter sales were $3.33 billion; organic sales declined 3%
  • First quarter EPS were $2.60 as reported, or $2.76 adjusted
  • First quarter total segment operating margin was 17.0% as reported, or 17.3% adjusted
  • EBITDA margin was 18.4% as reported, or 19.1% adjusted
  • Cash flow from operations was a first quarter record at $449 million, and reached 13.5% of sales
  • LORD Corporation and Exotic Metals Forming Company acquisitions completed
  • Company revises fiscal 2020 full year guidance

“We delivered increased adjusted total segment operating margin, EBITDA margin and record cash flow in the first quarter despite softness in global economic conditions," said Chairman and Chief Executive Officer, Tom Williams. "Adjusted total segment operating margin of 17.3% increased 10 basis points compared with the prior year quarter and adjusted EBITDA margin increased 110 basis points year-over-year to 19.1%. This performance reflects the effort of our global teams and the effective implementation of The Win Strategy™."

GUIDANCE:

Parker-Hannifin sees FY2020 EPS of $10.10-$10.90, versus the consensus of $11.74.

For the fiscal year ending June 30, 2020, the company has revised guidance for earnings per share to the range of $8.53 to $9.33, or $10.10 to $10.90 on an adjusted basis. Fiscal year 2020 guidance is adjusted on a pre-tax basis for expected business realignment expenses of approximately $40 million, costs to achieve of approximately $27 million, one-time acquisition expenses of approximately $200 million, and has been updated to include LORD Corporation and Exotic Metals Forming. Guidance assumes an organic sales decline in the range of 7.5% to 4.5%. A reconciliation of forecasted earnings per share to adjusted forecasted earnings per share is included in the financial tables of this press release.

Williams added, "Continued execution of the Win Strategy will position us to deliver strong margins, earnings and cash flow for the full fiscal year. We have revised guidance based on the impact of the closing of the LORD Corporation and Exotic Metals Forming acquisitions and softening macroeconomic trends."

For earnings history and earnings-related data on Parker-Hannifin (PH) click here.



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